Jackson County looks to neighbors in search for nonprofit funding policy

From animal shelters to free clinics to food banks, nonprofit organizations of all stripes make a yearly knock on county commissioners doors, hoping to be included in the upcoming budget. But as the recession marches on, those knocks are becoming more frequent — and more costly — for Jackson County commissioners.

“I think it’s going to get to the point we have to say we have ‘x’ amount of money to give to these entities,” said Jackson County Manager Chuck Wooten. “I just don’t think we can continue to add, add, add without having an impact on our budget overall.”

Just between 2013-14 and 2014-15, total requests have jumped by nearly $50,000, with 48 organizations requesting $651,000 for the new budget cycle. In 2013-14, commissioners doled out $556,000, while Wooten’s proposed budget recommends spending $579,000 this year. By contrast, the county spent only $256,000 in funding for 33 nonprofits in 2007-08, before the recession hit.

Currently, Jackson County doesn’t have any cap on its funding for nonprofits. Rather, commissioners get copies of the grant applications and decide who gets funding and how much. It’s a system that’s been around for a while, but it’s a system that could be in for a shake-up.

“We need a better-organized way of divvying up funds, whatever the amount is, to make sure that the money is going where the needs are,” said Commissioner Vicki Greene.

Once the 2014-15 budget is put to bed, Wooten said, county leaders will likely start figuring out just how to do that. Besides the obvious problem of expanding asks and, therefore, expanding allocations, there’s the issue of fairness. Not every organization that’s doing good work in the county gets itself on the list commissioners consider for funding, and among those that do there’s an element of arbitrariness when it comes to deciding who gets what.

“Who do you fund and who do you not fund?” Wooten said. “Really that’s put the commissioners in a difficult position.”

Concerns about efficiency are also part of the motivation behind a change. If the county contains multiple groups devoted to food, fuel or housing assistance, for example, does the county really need to fund each group individually? Or could the groups work together in order to use jointly granted taxpayer dollars with maximum efficiency?

“Just see if there’s a way that we can all work together, and rather than being asked to fund each individual [group], leave it up to these two groups to figure out how these funds can best be used,” Wooten said.

As it works through its options, Jackson County will be considering the approaches of its neighbors in addition to brainstorming its own ideas.

Macon County

One possible solution comes from Macon County, which for the past decade has funneled its nonprofit funding requests through the Community Funding Pool, an appointed task force that does the legwork of sorting through the applications.

“[Commissioners] were spending so very much time listening to requests from nonprofits,” said Bobbie Contino, the group’s secretary. “That is such a small portion of the county budget, but they were spending a disproportionate amount of time hearing the requests.”

The task force takes that load away from the commissioners. It’s an appointed group of nine community members who receive each application, grade it on factors such as how many people the service reaches, how important the service is to those people and how cost-efficient the nonprofit is in delivering the service.

“We individually go through them all and score them,” Contino said, “and then we have an evaluation session when all the team members come together and we discuss each application separately on its own merits.”

Then, the committee sends commissioners the grades and their recommendation for funding. The commissioners make the ultimate decision, but the committee makes the process less time-consuming for them.

“It works really well, I can tell you that,” Commissioner Ronnie Beale, who has been on the board for eight years, said of the funding pool. “Not everything gets funded at the amount requested, but they try to be fair.”

It is definitely a competitive field. In a typical year, the committee gets 15 to 20 applications but can only fund eight to 10 of them, most at relatively low dollar amounts. The nonprofit budget is capped at $50,000, with REACH — a shelter for domestic violence victims — and KIDS Place — a service for abused children — each guaranteed $10,000 of that $50,000 pie each year.

“There are two agencies in Macon County which the funding pool task force feels are essential enough they are requested to submit their application and a report, but … we fund them fully,” Contino said.

For the rest, the committee funds according a formula, a fact that is perhaps lucky considering that expanding asks in recent years have made the competition for dollars even heavier.

“We have had more organizations as the economy has tanked,” Contino said. “More organizations needing more money. I guess that’s true everywhere.”

Haywood County

Nonprofit organizations weren’t the only entities that started hurting when the recession hit. Counties suffered, too, and for Haywood County that meant cutting in some uncomfortable places.

“In the past there was funding [for nonprofits] when the economic situation was different, but the last four years or so we have not funded any nonprofits,” said Haywood County Commission Chairman Mark Swanger. “We don’t pick and choose. There’s just not enough funding.”

Of course, Haywood County still gets requests, but for now they’re not funding any of them. That’s far from being a best-case scenario, Swanger said, but it’s a necessity for now. For instance, this year revenue picked up by $350,000, but increasing costs in other areas of the budget ate that money quickly. The schools alone required a $75,000 increase to help compensate for rising costs and state funding cuts.

“There just is not sufficient revenue,” Swanger said. “We have to limit our appropriations at this point in time to those services that are critical. Law enforcement, public safety and so forth.”

Swain County

Swain County also takes a cautious approach when it comes to funding nonprofit organizations.

“Once you start one year, it’s kind of an obligation after that so our board has always looked at that as extra,” said County Manager Kevin King. “If there is a need in the community, of course we would look at that more heavily.”

Swain keeps its nonprofit funding below $100,000, with the bulk of that going to a set group of organizations. Typically, State of Franklin Health Council gets $65,000 to $70,000, Swain/Qualla SAFE gets $15,000 and Smoky Mountain Mental Health gets $20,000. Other organizations occasionally get some nominal amounts, but that’s not typical.

“We normally just don’t grant them,” King said.

Looking forward

When re-envisioning Jackson County’s process, the goal would be to keep nonprofit funding in the budget but to come up with a more efficient, affordable, fair process for granting funds.

“I don’t think our commissioners are at a point of wanting to discontinue funding, but I think they are at the point of saying we need to put a cap on it,” Wooten said.

“There may be an effort underway for next year to overhaul our process, perhaps better look at who the requesters are, if indeed they have followed through with the requirements for providing financial information,” Commissioner Greene said, “just to assure that county funds are being spent the way they are supposed to be spent.”

For example, she said, an organization that depends on volunteers might get preference over one that spends half its budget on staff salaries, because 100 percent of money given to the volunteer organization would go back into services.

Another part of prioritization could entail looking at how much community support each organization has. Non-profit organizations should be community-supported, Wooten said, not solely dependent on county money for their existence.

“We have to make sure that the community embraces those as well,” Wooten said, “that we’re just one of the funding components, that we’re not the main or the only funding component.”

By taking all those considerations into account, Jackson County hopes to become better able to achieve its ultimate goal when it comes to nonprofits.

“We are very sensitive that these groups do provide outstanding services to our community,” Wooten said. “We are very supportive of these services they provide and want them to be successful.”